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Brookline Bancorp Announces Third Quarter Results

BOSTON, Oct. 18, 2017 (GLOBE NEWSWIRE) -- Brookline Bancorp, Inc. (NASDAQ:BRKL) (the “Company”) today announced net income of $15.4 million, or $0.20 per basic and diluted share, for the third quarter of 2017, compared to $14.9 million, or $0.20 per basic and diluted share, for the second quarter of 2017, and $13.6 million, or $0.19 per basic and diluted share, for the third quarter of 2016. The third quarter of 2017 net income included merger and acquisition costs in connection with the Company's Agreement and Plan of Merger with First Commons Bank, N.A. executed on September 20, 2017.

“We are pleased to report that Brookline Bancorp maintained its consistent strong performance throughout the third quarter of 2017,” said Paul Perrault, President and Chief Executive Officer of the Company. “During the quarter, we generated steady growth in loans and deposits. We look forward to our continued success in growing our loans and deposit base organically, and welcoming customers of First Commons Bank to the Brookline family. The acquisition of First Commons Bank will add approximately $300 million in assets to our balance sheet in the first quarter of 2018 on condition of approval.”

BALANCE SHEET

Total assets at September 30, 2017 increased $28.2 million to $6.69 billion from $6.66 billion at June 30, 2017, and increased $306.0 million from $6.38 billion at September 30, 2016. At September 30, 2017, total loans and leases were $5.64 billion, representing an increase of $102.0 million from June 30, 2017, and an increase of $307.1 million from September 30, 2016. During the third quarter of 2017, total loans and leases increased 7.4 percent on an annualized basis.

Investment securities at September 30, 2017 decreased $19.3 million to $630.6 million, comprising 9.4 percent of total assets, as compared to $649.9 million, or 9.8 percent of total assets, at June 30, 2017, and increased approximately $29.3 million from $601.4 million, or 9.4 percent of total assets, at September 30, 2016.

Total deposits at September 30, 2017 increased $96.3 million to $4.81 billion from $4.71 billion at June 30, 2017 and increased $240.8 million from $4.56 billion at September 30, 2016. Core deposits, which consists of demand checking, NOW, savings, and money market accounts, increased $48.5 million from June 30, 2017 and increased $179.5 million from September 30, 2016.

Total borrowings at September 30, 2017 decreased $80.7 million to $985.9 million from $1.07 billion at June 30, 2017 and decreased $36.8 million from $1.02 billion at September 30, 2016.

The ratio of stockholders’ equity to total assets was 12.04 percent at September 30, 2017, as compared to 11.95 percent at June 30, 2017, and 10.91 percent at September 30, 2016, respectively. The ratio of tangible stockholders’ equity to tangible assets was 10.09 percent at September 30, 2017, as compared to 9.99 percent at June 30, 2017, and 8.82 percent at September 30, 2016. Tangible book value per share increased $0.11 from $8.52 at June 30, 2017 to $8.63 at September 30, 2017.

NET INTEREST INCOME

Net interest income increased $1.3 million to $56.8 million during the third quarter of 2017 from the quarter ended June 30, 2017. The net interest margin decreased 2 basis points to 3.57 percent for the three months ended September 30, 2017.

NON-INTEREST INCOME

Non-interest income for the quarter ended September 30, 2017 increased $1.5 million to $6.0 million from $4.5 million for the quarter ended June 30, 2017. The increase was primarily driven by increases of $0.7 million in loan level derivative income and in gain on sales of loans and leases.

PROVISION FOR CREDIT LOSSES

The Company recorded a provision for credit losses of $2.9 million for the quarter ended September 30, 2017, compared to $0.9 million for the quarter ended June 30, 2017. The increase in the provision for the quarter was primarily driven by growth in loans and an increase in the loss factors as a result of the ongoing assessment of loss factors.

Net charge-offs for the third quarter of 2017 were $2.0 million compared to $2.4 million in the second quarter of 2017. The ratio of net charge-offs to average loans and leases on an annualized basis decreased to 14 basis points for the third quarter of 2017 from 17 basis points for the second quarter of 2017. Net charge offs in the third quarter of 2017 primarily consisted of $1.3 million of taxi medallion loans and $0.3 million of equipment financing loans as compared to $2.3 million of commercial loans in the second quarter of 2017.

The allowance for loan and lease losses represented 1.16 percent of total loans and leases at September 30, 2017, compared to 1.17 percent at June 30, 2017, and 1.10 percent at September 30, 2016. The allowance for loan and lease losses related to originated loans and leases represented 1.20 percent of originated loans and leases at September 30, 2017, compared to 1.20 percent at June 30, 2017, and 1.15 percent at September 30, 2016.

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended September 30, 2017 increased $0.6 million to $35.4 million from $34.8 million for the quarter ended June 30, 2017. The increase was primarily driven by an increase of $0.2 million in compensation and employee benefits, an increase of $0.2 million in merger and acquisition expense, and an increase of $0.4 million in other non-interest expense, offset by a decrease of $0.1 million in FDIC insurance. The efficiency ratio for the third quarter was 56.37 percent compared to 57.93 percent for the second quarter of 2017 and 57.89 percent for the third quarter of 2016.

PROVISION FOR INCOME TAXES

The effective tax rate was 34.0 percent and 35.2 percent for the three and nine months ended September 30, 2017, respectively. The third quarter's effective tax rate was impacted by new accounting guidance that went into effect in 2017. This guidance requires that the excess tax benefit associated with stock compensation transactions be recorded through earnings as a discrete item within the Company's effective tax rate during the period of the transaction. The majority of the Company's stock compensation events typically occur in the third quarter. The prior guidance required the recognition of the excess tax benefit through additional paid in capital.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets increased to 0.92 percent during the third quarter of 2017 from 0.91 percent for the second quarter of 2017. The annualized return on average tangible assets increased to 0.94 percent for the third quarter of 2017 from 0.93 percent for the second quarter of 2017.

The annualized return on average stockholders' equity decreased to 7.64 percent during the third quarter of 2017 from 7.76 percent for the second quarter of 2017. The annualized return on average tangible stockholders’ equity decreased to 9.31 percent for the third quarter of 2017 from 9.58 percent for the second quarter of 2017.

ASSET QUALITY

The ratio of nonperforming loans and leases to total loans and leases was 0.71 percent at September 30, 2017 as compared to 0.76 percent at June 30, 2017. Nonperforming loans and leases decreased $2.3 million to $40.0 million at September 30, 2017 from $42.3 million at June 30, 2017. The ratio of nonperforming assets to total assets was 0.66 percent at September 30, 2017 as compared to 0.71 percent at June 30, 2017. Nonperforming assets decreased $2.8 million to $44.4 million at September 30, 2017 from $47.1 million at June 30, 2017. The decrease in nonperforming assets is due to the payoff of several nonperforming loans, charge offs of several taxi medallion loans, and sales of $0.5 million of other real estate owned and repossessed assets in the third quarter of 2017.

DIVIDEND DECLARED

The Company’s Board of Directors approved a dividend of $0.09 per share for the quarter ended September 30, 2017. The dividend will be paid on November 17, 2017 to stockholders of record on November 3, 2017.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Daylight Time on Thursday, October 19, 2017 to discuss the results for the quarter, business highlights and outlook. The call can be accessed by dialing 877-504-4120 (United States) or 412-902-6650 (internationally). A recorded playback of the call will be available for one week following the call at 877-344-7529 (United States) or 412-317-0088 (internationally). The passcode for the playback is 10112542. The call will be available live and in a recorded version on the Company’s website under “Investor Relations” at www.brooklinebancorp.com.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with $6.7 billion in assets and branch locations in Massachusetts and Rhode Island, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and First Ipswich Bank (the "banks"). The Company provides commercial and retail banking services, cash management and investment services to customers throughout Central New England. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com, www.bankri.com, and www.firstipswich.com.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the risks outlined in the Company’s Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings submitted to the Securities and Exchange Commission ("SEC"). The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

BASIS OF PRESENTATION

The Company's consolidated financial statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) as set forth by the Financial Accounting Standards Board in its Accounting Standards Codification and through the rules and interpretive releases of the SEC under the authority of federal securities laws. Certain amounts previously reported have been reclassified to conform to the current period's presentation.

NON-GAAP FINANCIAL MEASURES

The Company uses certain non-GAAP financial measures, such as the allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases, tangible book value per common share, tangible stockholders’ equity to tangible assets, return on average tangible assets and return on average tangible stockholders' equity. These non-GAAP financial measures provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial services sector. A detailed reconciliation table of the Company's GAAP to the non-GAAP measures is attached.

Contact:

Carl M. Carlson

Brookline Bancorp, Inc.

Chief Financial Officer

(617) 425-5331

ccarlson@brkl.com


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)
At and for the Three Months Ended
September 30,
2017
June 30,
2017
March 31,
2017
December 31,
2016
September 30,
2016
(Dollars In Thousands Except per Share Data)
Earnings Data:
Net interest income$56,843 $55,583 $53,098 $51,854 $52,350
Provision for credit losses 2,911 873 13,402 3,215 2,215
Non-interest income 5,973 4,477 15,908 5,430 5,329
Non-interest expense 35,408 34,795 33,756 32,607 33,388
Income before provision for income taxes 24,497 24,392 21,848 21,462 22,076
Net income attributable to Brookline Bancorp, Inc. 15,366 14,880 13,445 13,279 13,617
Performance Ratios:
Net interest margin (1) 3.57% 3.59% 3.53% 3.40% 3.48%
Interest-rate spread (1) 3.41% 3.39% 3.29% 3.24% 3.32%
Return on average assets (annualized) 0.92% 0.91% 0.83% 0.83% 0.86%
Return on average tangible assets (annualized) (non-GAAP) 0.94% 0.93% 0.85% 0.85% 0.88%
Return on average stockholders' equity (annualized) 7.64% 7.76% 7.58% 7.59% 7.83%
Return on average tangible stockholders' equity (annualized) (non-GAAP) 9.31% 9.58% 9.55% 9.60% 9.94%
Efficiency ratio (2) 56.37% 57.93% 48.92% 56.92% 57.89%
Per Common Share Data:
Net income — Basic$0.20 $0.20 $0.19 $0.19 $0.19
Net income — Diluted 0.20 0.20 0.19 0.19 0.19
Cash dividends declared 0.09 0.09 0.09 0.09 0.09
Book value per share (end of period) 10.52 10.42 10.00 9.88 9.90
Tangible book value per share (end of period) (non-GAAP) 8.63 8.52 7.93 7.81 7.81
Stock price (end of period) 15.50 14.60 15.65 16.40 12.19
Balance Sheet:
Total assets$6,686,284 $6,658,067 $6,497,721 $6,438,129 $6,380,312
Total loans and leases 5,639,440 5,537,406 5,461,779 5,398,864 5,332,300
Total deposits 4,805,683 4,709,419 4,651,903 4,611,076 4,564,906
Brookline Bancorp, Inc. stockholders’ equity 804,762 795,618 703,873 695,544 696,371
Asset Quality:
Nonperforming assets$44,371 $47,140 $47,349 $41,476 $38,704
Nonperforming assets as a percentage of total assets 0.66% 0.71% 0.73% 0.64% 0.61%
Allowance for loan and lease losses$65,413 $64,521 $66,133 $53,666 $58,892
Allowance for loan and lease losses as a percentage of total loans and leases 1.16% 1.17% 1.21% 0.99% 1.10%
Net loan and lease charge-offs$1,954 $2,402 $995 $8,337 $520
Net loan and lease charge-offs as a percentage of average loans and leases (annualized) 0.14% 0.17% 0.07% 0.62% 0.04%
Capital Ratios:
Stockholders’ equity to total assets 12.04% 11.95% 10.83% 10.80% 10.91%
Tangible stockholders’ equity to tangible assets (non-GAAP) 10.09% 9.99% 8.79% 8.73% 8.82%
(1) Calculated on a fully tax-equivalent basis.
(2) Calculated as non-interest expense as a percentage of net interest income plus non-interest income.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
September 30, 2017
June 30, 2017
March 31, 2017
December 31, 2016
September 30, 2016
ASSETS (In Thousands Except Share Data)
Cash and due from banks $35,392 $40,599 $33,565 $36,055 $32,196
Short-term investments 27,971 72,996 29,178 31,602 32,351
Total cash and cash equivalents 63,363 113,595 62,743 67,657 64,547
Investment securities available-for-sale 522,910 540,976 528,433 523,634 524,295
Investment securities held-to-maturity 107,738 108,963 100,691 87,120 77,094
Total investment securities 630,648 649,939 629,124 610,754 601,389
Loans and leases held-for-sale 2,973 593 1,152 13,078 21,109
Loans and leases:
Commercial real estate loans:
Commercial real estate mortgage 2,119,440 2,062,646 2,066,599 2,050,382 2,038,477
Multi-family mortgage 743,912 720,484 733,822 731,186 703,743
Construction 165,657 153,057 150,734 136,999 141,208
Total commercial real estate loans 3,029,009 2,936,187 2,951,155 2,918,567 2,883,428
Commercial loans and leases:
Commercial 689,010 691,070 644,240 635,426 652,316
Equipment financing 842,516 839,932 815,753 799,860 764,647
Condominium association 53,770 58,130 60,396 60,122 53,903
Total commercial loans and leases 1,585,296 1,589,132 1,520,389 1,495,408 1,470,866
Consumer loans:
Residential mortgage 652,415 646,679 631,863 624,349 617,065
Home equity 356,982 351,124 343,386 342,241 340,954
Other consumer 15,738 14,284 14,986 18,299 19,987
Total consumer loans 1,025,135 1,012,087 990,235 984,889 978,006
Total loans and leases 5,639,440 5,537,406 5,461,779 5,398,864 5,332,300
Allowance for loan and lease losses (65,413) (64,521) (66,133) (53,666) (58,892)
Net loans and leases 5,574,027 5,472,885 5,395,646 5,345,198 5,273,408
Restricted equity securities 62,135 66,988 68,065 64,511 65,683
Premises and equipment, net of accumulated depreciation 81,159 81,052 76,973 76,176 75,462
Deferred tax asset 28,093 26,982 29,859 25,247 22,894
Goodwill 137,890 137,890 137,890 137,890 137,890
Identified intangible assets, net of accumulated amortization 6,563 7,082 7,601 8,133 8,754
Other real estate owned and repossessed assets 4,398 4,873 2,286 1,399 1,152
Other assets 95,035 96,188 86,382 88,086 108,024
Total assets $6,686,284 $6,658,067 $6,497,721 $6,438,129 $6,380,312
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest-bearing deposits:
Demand checking accounts $905,472 $920,035 $898,161 $900,474 $889,278
Interest-bearing deposits:
NOW accounts 318,284 321,982 321,392 323,160 298,629
Savings accounts 665,558 584,408 575,808 613,061 591,156
Money market accounts 1,749,040 1,763,443 1,765,895 1,733,359 1,679,797
Certificate of deposit accounts 1,167,329 1,119,551 1,090,647 1,041,022 1,106,046
Total interest-bearing deposits 3,900,211 3,789,384 3,753,742 3,710,602 3,675,628
Total deposits 4,805,683 4,709,419 4,651,903 4,611,076 4,564,906
Borrowed funds:
Advances from the FHLBB 872,579 930,028 930,001 910,774 900,971
Subordinated debentures and notes 83,229 83,188 83,147 83,105 83,043
Other borrowed funds 30,087 53,427 43,637 50,207 38,639
Total borrowed funds 985,895 1,066,643 1,056,785 1,044,086 1,022,653
Mortgagors’ escrow accounts 8,151 7,714 8,032 7,645 8,166
Accrued expenses and other liabilities 74,019 71,232 69,752 72,573 81,670
Total liabilities 5,873,748 5,855,008 5,786,472 5,735,380 5,677,395
Stockholders' equity:
Brookline Bancorp, Inc. stockholders’ equity:
Common stock, $0.01 par value; 200,000,000 shares authorized; 81,695,695 shares
issued, 81,695,695 shares issued, 75,744,445 shares issued, 75,744,445 shares issued,
and 75,744,445 shares issued, respectively
817 817 757 757 757
Additional paid-in capital 700,624 699,923 617,364 616,734 616,142
Retained earnings, partially restricted 160,225 151,759 143,766 136,671 129,740
Accumulated other comprehensive (loss) income (1,893) (2,175) (3,261) (3,818) 4,896
Treasury stock, at cost;
4,572,954 shares, 4,717,775 shares, 4,707,096 shares, 4,707,096 shares, and
4,734,512 shares, respectively
(54,188) (53,837) (53,837) (53,837) (54,151)
Unallocated common stock held by the Employee Stock Ownership Plan;
150,921 shares, 159,510 shares, 168,099 shares, 176,688 shares, and 185,787 shares,
respectively
(823) (869) (916) (963) (1,013)
Total Brookline Bancorp, Inc. stockholders’ equity 804,762 795,618 703,873 695,544 696,371
Noncontrolling interest in subsidiary 7,774 7,441 7,376 7,205 6,546
Total stockholders' equity 812,536 803,059 711,249 702,749 702,917
Total liabilities and stockholders' equity $6,686,284 $6,658,067 $6,497,721 $6,438,129 $6,380,312

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
Three Months Ended
September 30, 2017
June 30, 2017
March 31, 2017
December 31, 2016
September 30, 2016
(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases $63,054 $61,138 $58,558 $57,247 $57,858
Debt securities 3,154 3,156 3,000 2,881 2,822
Marketable and restricted equity securities 788 797 726 762 804
Short-term investments 180 95 67 93 47
Total interest and dividend income 67,176 65,186 62,351 60,983 61,531
Interest expense:
Deposits 5,984 5,543 5,080 5,195 5,112
Borrowed funds 4,349 4,060 4,173 3,934 4,069
Total interest expense 10,333 9,603 9,253 9,129 9,181
Net interest income 56,843 55,583 53,098 51,854 52,350
Provision for credit losses 2,911 873 13,402 3,215 2,215
Net interest income after provision for credit losses 53,932 54,710 39,696 48,639 50,135
Non-interest income:
Deposit fees 2,547 2,552 2,409 2,263 2,289
Loan fees 282 229 261 322 330
Loan level derivative income, net 844 186 402 265 858
Gain on sales of investment securities, net 11,393
Gain on sales of loans and leases held-for-sale 1,049 307 353 1,270 588
Other 1,251 1,203 1,090 1,310 1,264
Total non-interest income 5,973 4,477 15,908 5,430 5,329
Non-interest expense:
Compensation and employee benefits 21,067 20,910 19,784 19,657 20,369
Occupancy 3,650 3,657 3,645 3,520 3,411
Equipment and data processing 4,210 4,164 4,063 4,028 3,826
Professional services 973 1,036 1,106 927 997
FDIC insurance 842 951 855 655 956
Advertising and marketing 839 857 817 823 844
Amortization of identified intangible assets 519 519 532 621 623
Merger and acquisition expense 205
Other 3,103 2,701 2,954 2,376 2,362
Total non-interest expense 35,408 34,795 33,756 32,607 33,388
Income before provision for income taxes 24,497 24,392 21,848 21,462 22,076
Provision for income taxes 8,330 8,759 7,835 7,524 7,804
Net income before noncontrolling interest in subsidiary 16,167 15,633 14,013 13,938 14,272
Less net income attributable to noncontrolling interest in subsidiary 801 753 568 659 655
Net income attributable to Brookline Bancorp, Inc. $15,366 $14,880 $13,445 $13,279 $13,617
Earnings per common share:
Basic $0.20 $0.20 $0.19 $0.19 $0.19
Diluted $0.20 $0.20 $0.19 $0.19 $0.19
Weighted average common shares outstanding during the period:
Basic 76,452,539 74,325,013 70,386,766 70,362,702 70,299,722
Diluted 76,961,948 74,810,088 70,844,096 70,592,204 70,450,760
Dividends declared per common share $0.09 $0.09 $0.09 $0.09 $0.09

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
Nine Months Ended September 30,
2017 2016
(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases $182,750 $167,474
Debt securities 9,310 8,829
Marketable and restricted equity securities 2,311 2,213
Short-term investments 342 149
Total interest and dividend income 194,713 178,665
Interest expense:
Deposits 16,607 14,875
Borrowed funds 12,582 11,980
Total interest expense 29,189 26,855
Net interest income 165,524 151,810
Provision for credit losses 17,186 7,138
Net interest income after provision for credit losses 148,338 144,672
Non-interest income:
Deposit Fees 7,508 6,650
Loan Fees 772 977
Loan level derivative income, net 1,432 3,697
Gain on sales of investment securities, net 11,393
Gain on sales of loans and leases held-for-sale 1,709 1,986
Other 3,544 3,893
Total non-interest income 26,358 17,203
Non-interest expense:
Compensation and employee benefits 61,761 58,179
Occupancy 10,952 10,328
Equipment and data processing 12,437 11,468
Professional services 3,115 2,925
FDIC insurance 2,648 2,677
Advertising and marketing 2,513 2,558
Amortization of identified intangible assets 1,570 1,879
Merger and acquisition expense 205
Other 8,758 7,707
Total non-interest expense 103,959 97,721
Income before provision for income taxes 70,737 64,154
Provision for income taxes 24,924 22,868
Net income before noncontrolling interest in subsidiary 45,813 41,286
Less net income attributable to noncontrolling interest in subsidiary 2,122 2,203
Net income attributable to Brookline Bancorp, Inc. $43,691 $39,083
Earnings per common share:
Basic $0.59 $0.56
Diluted $0.59 $0.56
Weighted average common shares outstanding during the period:
Basic 73,743,658 70,228,127
Diluted 74,226,316 70,394,465
Dividends declared per common share $0.27 $0.27

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)
At and for the Three Months Ended
September 30,
2017
June 30,
2017
March 31,
2017
December 31,
2016
September 30,
2016
(Dollars in Thousands)
NONPERFORMING ASSETS:
Loans and leases accounted for on a nonaccrual basis:
Commercial real estate mortgage $3,051 $2,766 $5,671 $5,340 $1,688
Multi-family mortgage 792 1,075 1,095 1,404 1,418
Construction 860
Total commercial real estate loans 4,703 3,841 6,766 6,744 3,106
Commercial 22,367 23,886 27,442 22,974 24,051
Equipment financing 9,858 9,702 6,445 6,758 6,652
Total commercial loans and leases 32,225 33,588 33,887 29,732 30,703
Residential mortgage 1,969 3,429 3,001 2,501 1,749
Home equity 1,047 1,366 1,333 951 1,780
Other consumer 29 43 76 149 214
Total consumer loans 3,045 4,838 4,410 3,601 3,743
Total nonaccrual loans and leases 39,973 42,267 45,063 40,077 37,552
Other real estate owned 3,235 3,384 618 618 367
Other repossessed assets 1,163 1,489 1,668 781 785
Total nonperforming assets $44,371 $47,140 $47,349 $41,476 $38,704
Loans and leases past due greater than 90 days and still accruing $2,523 $2,706 $6,515 $7,077 $8,275
Troubled debt restructurings on accrual 14,024 14,732 13,662 13,883 16,303
Troubled debt restructurings on nonaccrual 15,290 16,146 11,756 11,919 15,715
Total troubled debt restructurings $29,314 $30,878 $25,418 $25,802 $32,018
Nonperforming loans and leases as a percentage of total loans and leases 0.71% 0.76% 0.83% 0.74% 0.70%
Nonperforming assets as a percentage of total assets 0.66% 0.71% 0.73% 0.64% 0.61%
PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:
Allowance for loan and lease losses at beginning of period $64,521 $66,133 $53,666 $58,892 $57,258
Charge-offs (2,143) (3,365) (1,382) (8,629) (839)
Recoveries 189 963 387 292 319
Net charge-offs (1,954) (2,402) (995) (8,337) (520)
Provision for loan and lease losses 2,846 790 13,462 3,111 2,154
Allowance for loan and lease losses at end of period $65,413 $64,521 $66,133 $53,666 $58,892
Allowance for loan and lease losses as a percentage of total loans and leases 1.16% 1.17% 1.21% 0.99% 1.10%
Allowance for loan and lease losses related to originated loans and
leases as a percentage of originated loans and leases (non-GAAP)
1.20% 1.20% 1.25% 1.03% 1.15%
NET CHARGE-OFFS:
Commercial real estate loans $65 $(131) $(116) $635 $50
Commercial loans and leases 1,856 2,546 1,065 7,119 375
Consumer loans 33 (13) 46 583 95
Total net charge-offs $1,954 $2,402 $995 $8,337 $520
Net loan and lease charge-offs as a percentage of average loans and
leases (annualized)
0.14% 0.17% 0.07% 0.62% 0.04%

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
Three Months Ended
September 30, 2017 June 30, 2017 September 30, 2016
Average Balance Interest (1) Average
Yield/
Cost
Average Balance Interest (1) Average
Yield/
Cost
Average Balance Interest (1) Average
Yield/
Cost
(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2)$642,018 $3,264 2.03% $638,798 $3,267 2.05% $604,394 $2,910 1.93%
Marketable and restricted equity securities (2) 66,212 789 4.76% 68,629 799 4.66% 66,981 836 4.99%
Short-term investments 52,674 180 1.36% 43,739 95 0.87% 36,273 47 0.51%
Total investments 760,904 4,233 2.23% 751,166 4,161 2.22% 707,648 3,793 2.14%
Loans and Leases:
Commercial real estate loans (3) 2,974,185 31,299 4.12% 2,942,927 30,368 4.08% 2,872,733 29,470 4.10%
Commercial loans (3) 760,115 7,959 4.10% 728,014 7,665 4.17% 717,265 7,130 3.90%
Equipment financing (3) 846,027 13,983 6.61% 826,877 13,810 6.68% 759,622 12,189 6.42%
Residential mortgage loans (3) 649,831 6,043 3.72% 639,449 5,859 3.67% 620,741 5,513 3.55%
Other consumer loans (3) 369,925 4,015 4.30% 362,404 3,677 4.07% 356,516 3,810 4.24%
Total loans and leases 5,600,083 63,299 4.52% 5,499,671 61,379 4.46% 5,326,877 58,112 4.36%
Total interest-earning assets 6,360,987 67,532 4.25% 6,250,837 65,540 4.19% 6,034,525 61,905 4.10%
Allowance for loan and lease losses (65,140) (66,853) (58,032)
Non-interest-earning assets 385,195 372,681 383,604
Total assets$6,681,042 $6,556,665 $6,360,097
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts$321,731 55 0.07% $316,486 54 0.07% $295,762 52 0.07%
Savings accounts 605,303 306 0.20% 592,150 300 0.20% 566,192 318 0.22%
Money market accounts 1,765,610 2,267 0.51% 1,767,973 2,131 0.48% 1,678,937 1,905 0.45%
Certificates of deposit 1,139,699 3,356 1.17% 1,101,094 3,058 1.11% 1,112,831 2,837 1.01%
Total interest-bearing deposits 3,832,343 5,984 0.62% 3,777,703 5,543 0.59% 3,653,722 5,112 0.56%
Borrowings
Advances from the FHLBB 913,206 3,028 1.30% 896,565 2,755 1.22% 921,396 2,778 1.18%
Subordinated debentures and notes 83,204 1,274 6.13% 83,165 1,271 6.11% 83,036 1,259 6.07%
Other borrowed funds 41,368 47 0.45% 47,466 34 0.29% 46,417 32 0.27%
Total borrowings 1,037,778 4,349 1.64% 1,027,196 4,060 1.56% 1,050,849 4,069 1.52%
Total interest-bearing liabilities 4,870,121 10,333 0.84% 4,804,899 9,603 0.80% 4,704,571 9,181 0.78%
Non-interest-bearing liabilities:
Demand checking accounts 918,054 900,302 863,854
Other non-interest-bearing liabilities 80,616 77,682 90,025
Total liabilities 5,868,791 5,782,883 5,658,450
Brookline Bancorp, Inc. stockholders’ equity 804,666 766,529 695,205
Noncontrolling interest in subsidiary 7,585 7,253 6,442
Total liabilities and equity$6,681,042 $6,556,665 $6,360,097
Net interest income (tax-equivalent basis) /Interest-rate spread (4) 57,199 3.41% 55,937 3.39% 52,724 3.32%
Less adjustment of tax-exempt income 356 354 374
Net interest income $56,843 $55,583 $52,350
Net interest margin (5) 3.57% 3.59% 3.48%
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
Nine Months Ended
September 30, 2017 September 30, 2016
Average Balance Interest (1) Average
Yield/
Cost
Average Balance Interest (1) Average
Yield/
Cost
(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2)$631,549 $9,641 2.04% $604,603 $9,078 2.00%
Marketable and restricted equity securities (2) 68,104 2,306 4.52% 66,764 2,247 4.49%
Short-term investments 42,922 342 1.06% 46,198 149 0.43%
Total investments 742,575 12,289 2.21% 717,565 11,474 2.13%
Loans and Leases:
Commercial real estate loans (3) 2,949,313 91,134 4.07% 2,785,472 85,014 4.07%
Commercial loans (3) 730,453 22,737 4.11% 692,634 20,430 3.88%
Equipment financing (3) 826,494 40,907 6.60% 738,990 35,690 6.44%
Residential mortgage loans (3) 641,443 17,511 3.64% 624,102 16,705 3.57%
Other consumer loans (3) 364,407 11,187 4.10% 350,070 10,389 3.95%
Total loans and leases 5,512,110 183,476 4.44% 5,191,268 168,228 4.32%
Total interest-earning assets 6,254,685 195,765 4.17% 5,908,833 179,702 4.05%
Allowance for loan and lease losses (62,142) (57,982)
Non-interest-earning assets 374,558 379,761
Total assets$6,567,101 $6,230,612
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts$319,633 164 0.07% $289,908 156 0.07%
Savings accounts 603,814 916 0.20% 561,798 998 0.24%
Money market accounts 1,759,449 6,407 0.49% 1,654,700 5,547 0.45%
Certificates of deposit 1,088,011 9,120 1.12% 1,107,600 8,174 0.99%
Total interest-bearing deposits 3,770,907 16,607 0.59% 3,614,006 14,875 0.55%
Borrowings
Advances from the FHLBB 913,137 8,640 1.25% 888,406 8,125 1.20%
Subordinated debentures and notes 83,165 3,805 6.10% 82,996 3,773 6.06%
Other borrowed funds 49,752 137 0.37% 42,463 82 0.26%
Total borrowings 1,046,054 12,582 1.59% 1,013,865 11,980 1.55%
Total interest-bearing liabilities 4,816,961 29,189 0.81% 4,627,871 26,855 0.78%
Non-interest-bearing liabilities:
Demand checking accounts 905,684 829,659
Other non-interest-bearing liabilities 76,735 80,774
Total liabilities 5,799,380 5,538,304
Brookline Bancorp, Inc. stockholders’ equity 760,447 686,134
Noncontrolling interest in subsidiary 7,274 6,174
Total liabilities and equity$6,567,101 $6,230,612
Net interest income (tax-equivalent basis) /Interest-rate spread (4) 166,576 3.36% 152,847 3.27%
Less adjustment of tax-exempt income 1,052 1,037
Net interest income $165,524 $151,810
Net interest margin (5) 3.56% 3.46%
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
At and for the Three Months Ended
September 30,
At and for the Nine Months Ended
September 30,
2017 2016 2017 2016
Reconciliation Table - Non-GAAP Financial Information (Dollars in Thousands Except Share Data)
Net income attributable to Brookline Bancorp, Inc. $15,366 $13,617 $43,691 $39,083
Add:
Merger and acquisition-related
expenses (after-tax)
135 133
Net earnings from operations $15,501 $13,617 $43,824 $39,083
Operating earnings per common share:
Basic $0.20 $0.19 $0.59 $0.56
Diluted 0.20 0.19 0.59 0.56
Weighted average common shares outstanding during the period:
Basic 76,452,539 70,299,722 73,743,658 70,228,127
Diluted 76,961,948 70,450,760 74,226,316 70,394,465
At and for the Three Months Ended
September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016
(Dollars in Thousands)
Net income, as reported $15,366 $14,880 $13,445 $13,279 $13,617
Average total assets $6,681,042 $6,556,665 $6,461,183 $6,425,983 $6,360,097
Less: Average goodwill and average
identified intangible assets, net
144,747 145,269 145,778 146,382 146,997
Average tangible assets $6,536,295 $6,411,396 $6,315,405 $6,279,601 $6,213,100
Return on average tangible assets
(annualized)
0.94 % 0.93 % 0.85 % 0.85 % 0.88 %
Average total stockholders’ equity $804,666 $766,529 $709,095 $699,749 $695,205
Less: Average goodwill and average
identified intangible assets, net
144,747 145,269 145,778 146,382 146,997
Average tangible stockholders’ equity $659,919 $621,260 $563,317 $553,367 $548,208
Return on average tangible
stockholders’ equity (annualized)
9.31 % 9.58 % 9.55 % 9.60 % 9.94 %
Brookline Bancorp, Inc. stockholders’
equity
$804,762 $795,618 $703,873 $695,544 $696,371
Less:
Goodwill 137,890 137,890 137,890 137,890 137,890
Identified intangible assets, net 6,563 7,082 7,601 8,133 8,754
Tangible stockholders' equity $660,309 $650,646 $558,382 $549,521 $549,727
Total assets $6,686,284 $6,658,067 $6,497,721 $6,438,129 $6,380,312
Less:
Goodwill 137,890 137,890 137,890 137,890 137,890
Identified intangible assets, net 6,563 7,082 7,601 8,133 8,754
Tangible assets $6,541,831 $6,513,095 $6,352,230 $6,292,106 $6,233,668
Tangible stockholders’ equity to tangible
assets
10.09 % 9.99 % 8.79 % 8.73 % 8.82 %
Tangible stockholders' equity $660,309 $650,646 $558,382 $549,521 $549,727
Number of common shares issued 81,695,695 81,695,695 75,744,445 75,744,445 75,744,445
Less:
Treasury shares 4,572,954 4,717,775 4,707,096 4,707,096 4,734,512
Unallocated ESOP shares 150,921 159,510 168,099 176,688 185,787
Unvested restricted shares 471,702 457,966 476,854 476,854 476,938
Number of common shares outstanding 76,500,118 76,360,444 70,392,396 70,383,807 70,347,208
Tangible book value per common share $ 8.63 $ 8.52 $ 7.93 $ 7.81 $ 7.81
Allowance for loan and lease losses $65,413 $64,521 $66,133 $53,666 $58,892
Less:
Allowance for acquired loans and
leases losses
1,003 1,188 1,304 1,253 1,640
Allowance for originated loan and
lease losses
$64,410 $63,333 $64,829 $52,413 $57,252
Total loans and leases $5,639,440 $5,537,406 $5,461,779 $5,398,864 $5,332,300
Less:
Total acquired loans and leases 260,196 271,157 295,055 315,304 346,377
Total originated loans and leases $5,379,244 $5,266,249 $5,166,724 $5,083,560 $4,985,923
Allowance for loan and lease
losses related to originated loans
and leases as a percentage
of
originated loans and leases
1.20 % 1.20 % 1.25 % 1.03 % 1.15 %

Source:Brookline Bancorp, Inc.